Melbourne CBD prime retail space sold for $12 million

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A landmark in the city’s central business district, the former McGill’s book store, was sold in a competitive auction for $12.04 million.

Five bidders were competing for the iconic CBD building, which was offered for sale through Sebastian Drapac and Mark Wizel of CB Richard Ellis. It was sold with a price of $25,242 per square meter. The two level retail building is located nearby Bourke Street Mall, and opposite Melbourne’s GPO.

Drapac said there has been strong enquiry from both local and offshore investors, with multiple offers to acquire the building pre-auction. The eventual buyer was a local private investor, keen to gain a foothold in the Melbourne CBD retail market.

“The deal highlights the continued investor demand for properties in the CBD retail core despite some of the recent negative press in relation to rising interest rates and retail spending,” Drapac said.

“We are seeing continued confidence from retailers and landlords – particularly in prime locations such as Bourke Street Mall – as highlighted by the major refurbishments of Myer and David Jones.” CBRE’s Mark Wizel said the sale of 193 Elizabeth Street was the latest in a series of prime CBD retail investment deals, following the earlier sales of 389 Swanston Street and Bradman’s building at 270-272 Bourke Street.

“There is a distinct demand/supply imbalance for properties of this caliber,” Wizel said. “The sale of 193 Elizabeth Street presented a rare opportunity to acquire a centrally located, freestanding investment with a significant percentage of the income underwritten by long leases to well performing national food and beverage tenants.”

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